Here's What Investors Must Know Ahead of Mohawk's Q3 Earnings

Mohawk Industries, Inc. MHK is scheduled to report results for its third quarter of 2025 on Oct. 23, after market close.

In the last reported quarter, the company’s adjusted earnings per share (EPS) and net sales topped the Zacks Consensus Estimate by 5.7% and 0.4%, respectively. On a year-over-year basis, the top line remained flat while the bottom line tumbled 7.7%.

MHK’s earnings surpassed expectations in each of the trailing four quarters, with an average surprise of 4.4%.

Trends in MHK’s Estimate Revision

The Zacks Consensus Estimate for third-quarter EPS has remained unchanged at $2.67 over the past 60 days, indicating a 7.9% decline from the prior-year period’s EPS of $2.90.

Mohawk Industries, Inc. Price, Consensus and EPS Surprise

Mohawk Industries, Inc. price-consensus-eps-surprise-chart | Mohawk Industries, Inc. Quote

The consensus estimate for net sales is pegged at $2.72 billion, indicating a 0.2% inch up from the year-ago period.

Factors Attributing to Mohawk’s Quarterly Results

During the third quarter, Mohawk’s top-line performance is expected to have been relatively flat year over year. During the to-be-reported quarter, the company is likely to have benefited from favorable prices and product mix alongside favorable foreign exchange rates. Its new premium residential and commercial product collections, launched over the past two years, are expected to have been faring well. However, these positive aspects are likely to have been partially offset by weaker market volumes as the residential market continues to remain soft and market seasonality returns, with other macroeconomic challenges adding to the woes.

Our model expects third-quarter net sales in the Global Ceramic to inch up 0.5% to $1.06 billion, Flooring North America to fall 0.9% year over year to $965.6 million and Flooring Rest of World to increase 0.2% to $688.6 million.

Regarding the bottom line of MHK, it is expected to have tumbled year over year because of higher input costs, elevated restructuring, acquisition and integration-related costs, alongside lower sales volume. The margins of the company are likely to have been under pressure during the third quarter because of this uncertain cost structure. Even though Mohawk is consistently working on reducing costs through enhancing equipment use, saving energy, improving supply-chain processes and redesigning products, the market pressures have been weighing heavily on the tailwinds.

The company expects adjusted EPS to be in the range of $2.56-$2.66 (excluding restructuring and other charges), indicating a decline from the year-ago figure of $2.90.

We expect the adjusted gross margin to contract year over year by 120 basis points (bps) to 25%. The adjusted operating margin is projected to decrease by 100 bps 7.8% from the year-ago period.

What Our Model Unveils for MHK

Our proven model does not predict an earnings beat for Mohawk this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. However, it is not the case this time.

Earnings ESP: MHK has an Earnings ESP of -1.02%. You can uncover the best stocks before they’re reported with our Earnings ESP Filter.

Zacks Rank: The company currently carries a Zacks Rank #4 (Sell). 

You can see the complete list of today’s Zacks #1 Rank stocks here.

Stocks Poised to Beat Earnings Estimates

Here are some stocks from the Zacks Consumer Discretionary sector, which according to our model, have the right combination of elements to post an earnings beat.

Las Vegas Sands Corp. LVS has an Earnings ESP of +9.32% and a Zacks Rank of 1 at present.

The company’s earnings for the third quarter of 2025 are expected to increase 38.6%. Las Vegas Sands reported better-than-expected earnings in one of the trailing four quarters and missed on the other three occasions, the average surprise being 3%.

PENN Entertainment, Inc. PENN currently has an Earnings ESP of +89.87% and a Zacks Rank of 2.

PENN Entertainment’s earnings for the third quarter of 2025 are expected to increase 58.3%. The company reported better-than-expected earnings in three of the trailing four quarters and missed on the remaining one occasion, the average surprise being 92.7%.

Boyd Gaming Corporation BYD currently has an Earnings ESP of +4.25% and a Zacks Rank of 2.

Boyd Gaming’s earnings for the third quarter of 2025 are expected to inch up 1.3%. The company reported better-than-expected earnings in each of the trailing four quarters, the average surprise being 9.1%.

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This article originally published on Zacks Investment Research (zacks.com).

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